From Game of Thrones to Game of Loans - Shadow Chancellor John McDonnell has outlined plans for a ‘Bank of the North’.

He said it would play a key role in Labour’s multi billion pound transport and investment strategy which he said if implemented could create around 60,000 jobs in the region.

Mr McDonnell said: “We have long thought about a National Investment Bank, invested in by government which also levers in Private Sector money.

“We’re looking to see a regional arm of it, a Bank of the North.”

He joked: “You might think I’ve been watching too much Game of Thrones.”

Mr McDonnell said local representatives would help decide what investment was needed and where it should go for the region to have a proper say on the policy.

Speaking at Labour’s Regional Economic Conference held at the Centre for Life, in Newcastle, he said: “Here in the North East, where the first commercial steam railway was opened, we’ll build on its immense legacy of engineering and manufacturing success.

“We’ll invest in new local rail so that every part of every county here can share in the prosperity.”

Before he arrived in the city, Mr McDonnell had given a preview of the plan. He said a Labour government would provide £527 million to replace aging trains on the North East Metro.

It would also push ahead with a series of projects including the reopening the Leamside line at a cost of £300 million, fund plans to re-open the Ashington, Blyth and Tyne line, at a cost of £110 million, while £400 million will be available for rail services in Tees Valley, including electrification of the Northallerton to Teesport line, improvements to Darlington Station and improvements to Middlesbrough Station .

In his speech on Saturday he said: “It can be part of unlocking an extra £20bn economic potential for the North, helping create 60,000 extra jobs.

“Not my figures, but the careful estimates of Transport for the North. The economic potential here is huge.”

He said the potential of the North East was being wasted by this Conservative government.

While London received almost £2,000 per head in transport investment, the North East got £220 a head.

“That funding gap has real consequences, “ said Mr McDonnell.

“It means that communities can’t prosper when they could. It means that decent jobs can’t be created that could be

He added: “The old rules for the economy have failed. The belief that freedom for financial markets would deliver stability lead to the crash of 2008. The belief that wealth would trickle down from the richest to the rest has led to massive inequality.

“The belief that free markets alone would deliver efficiency means that workers in deregulated Britain take five days to produce what workers in Germany or France produce in four.

“The old rules have given us an economy in which too much wealth is held in too few hands.

“The rules have meant the economy was permanently rigged to the benefit of the elite, and against the rest of us.

Regional Economic Conference in Newcastle

He said Labour will commit to putting in place a “real industrial strategy”, focused on getting government to deliver for local areas where they say potential is being wasted.

He said: “It means supporting initiatives like the Teesside Collective, which will build on the natural advantages and expertise in the area to create a clean-technology industrial hub.

“A pilot project would cost £110m up-front, but have the potential to deliver £31m every year in savings for government.

“And on the back of the pilot, the potential for expansion is huge. The UK would become a world-leader for viable carbon capture and storage.”

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However, to put these plans in place Labour needs to win the next general election. After a narrow victory in the Stoke by-election, the defeat in Copeland and the party being 18% behind the Tories in the opinion polls, the chances of forming the next government look remote.

Despite this Mr McDonnell said he was confident of victory although he admitted it would be tough.

He claimed after the post mortem following the two by-election results which saw fresh calls for leader Jeremy Corbyn to stand down and talk of civil war erupting within it yet again, a different Labour party has now emerged.

“The Labour party looked over the edge at Copeland and decided that was not the way to go. We need to unite now and if we develop our policies and demonstrate we’re a united party I think there’s a real chance of not just winning the next election but of getting a majority so we can put our plans in place.”